Wage and salary Administration

5 REASONS WHY EMPLOYEES STAY: 1. Pride in the organization. People want to work for wellmanaged companies. 2. Compatible supervisor. People may stay just to work for a particular individual who is supportive of them. 3. Compensation. People want to work for companies that offer fair compensation, including competitive wages and benefits as well as opportunities to learn and achieve. 4. Affiliation. People want to continue working with colleagues they respect and like. 5. Meaningful work. People want to work for companies that let them do work that appeals to their deepest, most passionate interests.

Top-Five Reasons Why People Quit Their Jobs

1. Management demands that one person do the jobs of two or more people, resulting in longer days and weekend work. 2. Management cuts back on administrative help, forcing professional workers to use their time copying, stapling, collating, filing and other clerical duties. 3. Management puts a freeze on raises and promotions, when an employee can easily find a job earning 20-30 percent more somewhere else. 4. Management doesn't allow the rank and file to make decisions or allow them pride of ownership. 5. Management constantly reorganizes, shuffles people around, and changes direction constantly.

Nature and purpose

Establishment and implementation of sound

policies and practices of employee compensation To establish and maintain an equitable wage and salary structure Balancing of conflicting personnel interests so that satisfaction maximized and conflicts minimized Financial aspect of needs, motivation and rewards

Objectives
For employees

Highly skilled jobs are paid more

compensation then low skilled jobs this eliminated inequality Chances of favoritism are minimized Job sequence and line of promotion are established Employees morale and motivation are increased

To employers

Systematically plan for labor cost In dealing with trade union, they can

explain it based on systematic analysis Reduces chances of friction and grievances Enhances motivation and morale Attracts qualified employees

Compensation, Reward, wage levels and wage structure

Compensation defined as money received

in the performance of work plus benefits and services Money is included under direct compensation while benefits come under indirect compensation consist of life, accident and health insurance, retirement benefits, pay for vacation and social security

 Wage:- is remuneration paid for the service of

labor in production periodically to worker It refer to hourly rate or daily rate paid to blue collar workers Salary refers to weekly or monthly rates paid to white collar workers Wage level represent money an average worker makes in organization Wage structure describes wage/salary relationship with particular grouping The grouping can be according to occupation such as craftsmen

Wage determination process

. Job analysis
Wage surveys & analysis of relevant organizational problems

Wage surveys
Wage structure Rules of administrat ion Differential employee appraisal Wage payments

Job specification job description

Job evaluation

Performance standards

Job analysis:- results in job

descriptions which lead to job specification A job is rated in order to determine its value compare to all other job in organization and providing it with a price This involves converting job value into specific Monterey value or rate ranges

Wage surveys:- once the relative worth of job

is done , the actual amount is determined This is done by making wage or salary surveys Such surveys seek to answer questions like what are the other firms paying? What they are doing for benefits? Level of pay offered by other firms for similar occupations? Relevant organizational problems:- what will be results of paying lower or higher compensation? Relationship between wage structure and fringe benefits?

Preparation of wage structure:- for this several decision has to be taken such as Whether organization able to pay above, below, or equal to average in industry Whether wages ranges on merit basis or single rates The number and width of pay grades Actual money value to be signed to grades Difference between pay plans

Defining the Labor Market List of Key Job Position Detailed Description of Jobs

Collection of Salary Data Compilation of Salary Data

Results Survey

Rules of administration:To determine what extent advancement will be on length of service rather then merit With what frequency pay increases will be made How control over wage and salary cost can be determined Rule for promotion from one pay grade to another

Factors influencing wage and salary structure and admin

The organizations ability to pay Supply and demand of labor The prevailing market rate The cost of living

Productivity
Trade unions bargaining power Job requirements Managerial attitude Psychological and social factors

Levels of skills available in market

THANK YOU